Form 1099-K

The beginning of another year means tax season is quickly approaching, and we want to ensure that both you and your end users are up to speed on what to expect from Dwolla regarding Form 1099-Ks. To learn more about Form 1099-Ks at Dwolla check out this blog post or this FAQ page.

Since the IRS and states are targeting voluntary compliance on income reporting, Dwolla is required to report on gross payments received by users to the applicable agencies. In addition, Dwolla will send a Form 1099-K, with the name “Dwolla, Inc.” displayed on the form, to your end users who meet the federal/state transaction and/or dollar amount threshold.

If you are an end user of a Dwolla Client and have met one of the following thresholds, you can follow this link to fill out the required W9 form needed.

    1. An end user has received over 200 gross payments during the calendar year totaling $20,000 USD or more, which exceeds the federal threshold.
    2. An end user resides in the state of Vermont, Massachusetts, Mississippi or the District of Columbia and has received more than $600 USD in gross payments within a calendar year. 
    3. An end user resides in the state of Missouri and has received more than $1,200 in gross payments within a calendar year.
    4. An end user resides in the state of New Jersey and has received more than $1,000 in gross payments within a calendar year. 
    5. An end user resides in the state of Arkansas and has received more than $2,500 in gross payments within a calendar year.
    6. An end user resides in the state of Pennsylvania and has received more than $5,000 in gross payments within a calendar year. 

Vermont, and Massachusetts, Mississippi, Missouri, New Jersey, Arkansas and the District of Columbia are the only states/territories that have different thresholds than the federal this requirement at the time of this notice.

Dwolla will send an official list of qualifying end users to each of our Client’s for them to reach out to end users as well. That communication will look similar to the following:

 

Dwolla, Inc., our payment partner, will file a tax Form 1099-K with the IRS and relevant state agencies and send you a 2019 Form 1099-K if you meet one or both of the following reporting thresholds:

      1. You have received over 200 gross payments during the calendar year totaling $20,000 USD or more, which exceeds the federal threshold.
      2. You reside in the state of Vermont, Massachusetts, Mississippi or the District of Columbia and you have received more than $600 USD in gross payments within a calendar year.
      3. You reside in the state of Missouri and you have received more than $1,200 in gross payments within a calendar year.
      4. You reside in the state of New Jersey and you you have received more than $1,000 in gross payments within a calendar year.
      5. You reside in the state of Arkansas and you have received more than $2,500 in gross payments within a calendar year.
      6. You reside in the state of Pennsylvania and you have received more than $5,000 in gross payments within a calendar year.

Vermont, and Massachusetts, Mississippi, Missouri, New Jersey, Arkansas and the District of Columbia are the only states/territories that have different thresholds than the federal requirement at the time of this email.

Both the federal and state Form 1099-Ks are information returns and the gross payments reported on a Form 1099-K do not necessarily represent reportable income. The form should be used in conjunction with other tax records (bank statements, invoices, etc.) to report taxable income, if any.

Please consult your tax advisor to determine your tax reporting requirements.

For any questions regarding Form 1099-Ks, please contact us at partnersupport@dwolla.com.